News Story

Consumers Energy Has A Solar And Wind Electricity Plan

Consumers Energy says getting more electricity from renewable sources and closing coal plants will save customers money, and it has a plan to do so.

Saving money would be welcome, according to Jason Hayes, who covers environmental policy for the Mackinac Center for Public Policy in Midland. He points out that residents here currently pay 13% more than neighboring Great Lakes states and 16% more than the national average.

The following are 2020 rates in cents per kilowatt hour, when averaging residential, commercial, and industrial sectors:

Michigan 12.37 cents

Wisconsin 11.22 cents

Minnesota 10.84 cents

Indiana 9.75 cents

Pennsylvania 9.69 cents

Illinois 9.56 cents

Ohio 9.28 cents

The national average is 10.66 cents per kilowatt hour.

It hasn’t helped that Consumers Energy has imposed at least $165 million in rate increases since 2018, and in March asked regulators for another $254 million rate hike. This came three months after the state’s Public Service Commission approved a $100 million rate increase for the regulated monopoly.

But according to Katie Carey, director of external relations for Consumers Energy, the utility has a new electricity generation plan that “creates price stability” and “by using the natural gas as a fuel source to generate baseload power, will save customers about $650 million through 2040.”

In the company’s latest rate hike request, it admitted some of the new money will pay for solar generation projects and “adjustments to the Company’s current Electric Vehicle pilot programs.”

Consumers Energy submitted a 2019 Clean Energy Plan around the same time it asked for the recent round of rate increases. This states, “We developed the Clean Energy Plan for 2019–2040 considering people, the planet and Michigan’s prosperity by modeling a variety of assumptions, such as market prices, energy demand and levels of clean energy resources (wind, solar, batteries and energy waste reduction).”

Hayes questions the value for residents of paying higher rates that, in part, will enable the utility to experiment with solar generation in Michigan’s northern climate. He said the February 2021 rate hike request openly admits money spent on solar collectors and new transmission lines for them and for wind turbines are a “significant driver of the requested relief” – the rate increases, that is.

Closely related to all this, Consumers Energy recently issued an Integrated Resource Plan, as required by state law. It includes closing coal plants by 2025, or 15 years sooner than a 2019 plan projected.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.